Imagine a college making a partnership decision that could be worth millions – even tens of millions – of dollars, and that would bind it to a seven- to ten-year commitment. You would assume that that college would put significant time, resources, and analytical rigor into the decision making, would you not? Well, our research suggests your assumption would be wrong.

An estimated 250 US higher education institutions already partner with an Online Program Management (OPM) provider, according to a report just released, and hundreds more are considering doing so. OPM is defined by the provision of at least four key services to institutions on a long-term, often revenue-sharing basis: Marketing, Enrollment Management, Course Development & Delivery, and Student Services. It has become a big business, worth hundreds of millions of dollars annually, with a deal to put a single academic program online often worth millions to both sides of the transaction.

And yet our interviews with about 15 institutions currently engaged in a partnership – as well as our experience in the field – lead us to the conclusion that art triumphs over science in partner selection. While the typical college spends months (or even years) in committee meetings mulling over the decision, it ultimately selects a provider based on a few intangible factors, generally characterized under the rubric of “fit.” For their part, leading OPM providers have often marketed themselves in a remarkably similar fashion – reinforcing the need for institutions to decide based on intangibles, and so on.

However, we find evidence that the OPM market is fundamentally changing – willing institutions are increasingly being provided with real choice, as multiple recent market entrants have made the provider field more crowded than ever before. Meanwhile, the business model has been in place long enough that more institutions are coming up for renewal of their long-term contracts, and faced with their second round of decision-making, they find they enter it with a new sense of strategic clarity founded on experience. Thus, a few brave institutions are weaning themselves off of their service providers by switching providers or choosing to “go it alone” – even if the overwhelming majority renew their agreements, if on new terms.

To us, the latest developments in the OPM market indicate a growing strategic sophistication among institutions regarding complex “build vs. buy” decision-making. Which is just as well, because the evidence suggests that college leaders are making them more often.